10.24.14
BASF Group's sales grew by 3% compared with the previous third quarter, reaching €18.3 billion. A sharp rise in volumes in the Natural Gas Trading business sector was mainly responsible for this growth.
Income from operations (EBIT) before special items increased by €150 million to around €1.8 billion. The primary contributors to this development were the Chemicals and Oil & Gas segments, together with Other. The increase was dampened by a considerable earnings decline in the Agricultural Solutions segment.
“The economic environment remained challenging in the third quarter of 2014. Geopolitical tensions and increasing uncertainty about the global economic development significantly dampened demand for chemical products. Nevertheless, sales and earnings of BASF Group increased in the third quarter of 2014,” said Dr. Kurt Bock, chairman of the Board of Executive Directors of BASF SE.
EBIT grew by €128 million to €1.8 billion compared with the third quarter of the previous year. EBITDA rose by €30 million to €2.5 billion. Income before taxes and minority interests increased by €126 million quarter-on-quarter to €1.6 billion. Because of the higher tax rate and increased minority interests, net income declined by €53 million to €1.0 billion. Earnings per share were €1.14 in the third quarter of 2014, compared with €1.20 in the same quarter of 2013. Adjusted for special items and amortization of intangible assets, earnings per share amounted to €1.27, remaining at the same level as the previous third quarter (€1.28).
For the fourth quarter of 2014, BASF does not anticipate an upturn in demand.
“We assume that the environment will remain volatile and challenging,” Bock said. “We nevertheless still aim to slightly raise our EBIT before special items for the year 2014.” Sales are likely to decrease slightly as a result of the divestiture of the gas trading and storage business planned for this year in addition to negative currency effects.
BASF now expects the average annual growth of global gross domestic product to be about 0.8% percentage points lower (prior assumption: 3.4% p.a., current assumption: 2.6% p.a.). Growth of industrial production is now assumed to be 3.4% p.a., versus a previous assumption of 4.6% p.a. The company now assumes the growth of chemical production to be 4.0% p.a. instead of 4.9% p.a. – still growing well above GDP and industrial production. For 2015, BASF now expects sales and EBITDA to be in line with market expectations. For EBITDA, they are between €10 billion and €12 billion.
“The reasons for this weak global economic development are obvious: reduced growth dynamics of emerging markets and a delayed recovery in the European economy,” Bock reported.
Sales reached the level of the previous third quarter in the Performance Products segment. Volumes and sales prices remained stable while currency effects were negative. Volumes increased significantly in the Performance Chemicals division. In the Functional Materials & Solutions segment, sales exceeded the level of the third quarter of 2013 by 2%.
Income from operations (EBIT) before special items increased by €150 million to around €1.8 billion. The primary contributors to this development were the Chemicals and Oil & Gas segments, together with Other. The increase was dampened by a considerable earnings decline in the Agricultural Solutions segment.
“The economic environment remained challenging in the third quarter of 2014. Geopolitical tensions and increasing uncertainty about the global economic development significantly dampened demand for chemical products. Nevertheless, sales and earnings of BASF Group increased in the third quarter of 2014,” said Dr. Kurt Bock, chairman of the Board of Executive Directors of BASF SE.
EBIT grew by €128 million to €1.8 billion compared with the third quarter of the previous year. EBITDA rose by €30 million to €2.5 billion. Income before taxes and minority interests increased by €126 million quarter-on-quarter to €1.6 billion. Because of the higher tax rate and increased minority interests, net income declined by €53 million to €1.0 billion. Earnings per share were €1.14 in the third quarter of 2014, compared with €1.20 in the same quarter of 2013. Adjusted for special items and amortization of intangible assets, earnings per share amounted to €1.27, remaining at the same level as the previous third quarter (€1.28).
For the fourth quarter of 2014, BASF does not anticipate an upturn in demand.
“We assume that the environment will remain volatile and challenging,” Bock said. “We nevertheless still aim to slightly raise our EBIT before special items for the year 2014.” Sales are likely to decrease slightly as a result of the divestiture of the gas trading and storage business planned for this year in addition to negative currency effects.
BASF now expects the average annual growth of global gross domestic product to be about 0.8% percentage points lower (prior assumption: 3.4% p.a., current assumption: 2.6% p.a.). Growth of industrial production is now assumed to be 3.4% p.a., versus a previous assumption of 4.6% p.a. The company now assumes the growth of chemical production to be 4.0% p.a. instead of 4.9% p.a. – still growing well above GDP and industrial production. For 2015, BASF now expects sales and EBITDA to be in line with market expectations. For EBITDA, they are between €10 billion and €12 billion.
“The reasons for this weak global economic development are obvious: reduced growth dynamics of emerging markets and a delayed recovery in the European economy,” Bock reported.
Sales reached the level of the previous third quarter in the Performance Products segment. Volumes and sales prices remained stable while currency effects were negative. Volumes increased significantly in the Performance Chemicals division. In the Functional Materials & Solutions segment, sales exceeded the level of the third quarter of 2013 by 2%.